The advent of the Internet has resulted in the ability to communicate data across the globe instantaneously, and will allow for numerous new applications which enhance consumer""s lives. One of the enhancements which can occur is the ability for the consumer to receive advertising which is relevant to their lifestyle, rather than a stream of ads determined by the program they are watching. Such xe2x80x9ctargeted adsxe2x80x9d can potentially reduce the amount of unwanted information which consumers receive in the mail, during television programs, and when using the Internet.
From an advertiser""s perspective the ability to target ads can be beneficial since they have some confidence that their ad will at least be determined relevant by the consumer, and therefore will not be found annoying because it is not applicable to their lifestyle.
In order to determine the applicability of an advertisement to a consumer, it is necessary to know something about their lifestyle, and in particular to understand their demographics (age, household size, income). In some instances it is useful to know their particular purchasing habits. As an example, a vendor of soups would like to know which consumers are buying their competitor""s soup, so that they can target ads at those consumers in an effort to convince them to switch brands. That vendor will probably not want to target loyal customers, although for a new product introduction the strategy may be to convince loyal customers to try the new product. In both cases it is extremely useful for the vendor to be able to determine what brand of product the consumer presently purchases.
There are several difficulties associated with the collection, processing, and storage of consumer data. First, collecting consumer data and determining the demographic parameters of the consumer can be difficult. Surveys can be performed, and in some instances the consumer will willingly give access to normally private data including family size, age of family members, and household income. In such circumstances there generally needs to be an agreement with the consumer regarding how the data will be used. If the consumer does not provide this data directly, the information must be xe2x80x9cminedxe2x80x9d from various pieces of information which are gathered about the consumer, typically from specific purchases.
Once data is collected, usually from one source, some type of processing can be performed to determine a particular aspect of the consumer""s life. As an example, processing can be performed on credit data to determine which consumers are a good credit risk and have recently applied for credit. The resulting list of consumers can be solicited, typically by direct mail.
Although information such as credit history is stored on multiple databases, storage of other information such as the specifics of grocery purchases is not typically performed. Even if each individual""s detailed list of grocery purchases was recorded, the information would be of little use since it would amount to nothing more than unprocessed shopping lists.
Privacy concerns are also an important factor in using consumer purchase information. Consumers will generally find it desirable that advertisements and other information is matched with their interests, but will not allow indiscriminate access to their demographic profile and purchase records.
The Internet has spawned the concept of xe2x80x9cnegatively priced informationxe2x80x9d in which consumers can be paid to receive advertising. Paying consumers to watch advertisements can be accomplished interactively over the Internet, with the consumer acknowledging that they will watch an advertisement for a particular price. Previously proposed schemes such as that described in U.S. Pat. No. 5,794,210, entitled xe2x80x9cAttention Brokerage,xe2x80x9d of which A. Nathaniel Goldhaber and Gary Fitts are the inventors, describe such a system, in which the consumer is presented with a list of advertisements and their corresponding payments. The consumer chooses from the list and is compensated for viewing the advertisement. The system requires real-time interactivity in that the viewer must select the advertisement from the list of choices presented.
The ability to place ads to consumers and compensate them for viewing the advertisements opens many possibilities for new models of advertising. However, it is important to understand the demographics and product preferences of the consumer in order to be able to determine if an advertisement is appropriate.
Although it is possible to collect statistical information regarding consumers of particular products and compare those profiles against individual demographic data points of consumers, such a methodology only allows for selection of potential consumers based on the demographics of existing customers of the same or similar products. U.S. Pat. No. 5,515,098, entitled xe2x80x9cSystem and method for selectively distributing commercial messages over a communications network,xe2x80x9d of which John B. Carles is the inventor, describes a method in which target household data of actual customers of a product are compared against subscriber household data to determine the applicability of a commercial to a household. It will frequently be desirable to target an advertisement to a market having discretionary characteristics and to obtain a measure of the correlation of these discretionary features with probabilistic or deterministic data of the consumer/subscriber, rather than being forced to rely on the characteristics of existing consumers of a product. Such correlations should be possible based both on demographic characteristics and product preferences.
Another previously proposed system, described in U.S. Pat. No. 5,724,521, entitled xe2x80x9cMethod and apparatus for providing electronic advertisements to end users in a consumer best-fit pricing manner,xe2x80x9d of which R. Dedrick is the inventor, utilizes a consumer scale as the mechanism to determine to which group and advertisement is intended. Such a system requires specification of numerous parameters and weighting factors, and requires access to specific and non-statistical personal profile information.
For the foregoing reasons, there is a need for an advertisement selection system which can match an advertisement with discretionary target market characteristics, and which can do so in a manner which protects the privacy of the consumer data and characterizations.
The present invention describes a system for determining the applicability of an advertisement to a consumer, based on the reception of an ad characterization vector and use of a unique consumer ID. The consumer ID is used to retrieve a consumer characterization vector, and the correlation between the consumer characterization vector and the ad characterization vector is used to determine the applicability of the advertisement to the consumer. The price to be paid for presentation of the advertisement can be determined based on the degree of correlation.
The price to present an advertisement can increase with correlation, as may be typical when the content/opportunity provider is also the profiling entity. The price can decrease with correlation when the consumer is the profiler, and is interested in, and willing to charge less for seeing advertisements which are highly correlated with their demographics, lifestyle, and product preferences.
The present invention can be used to specify purchasers of a specific product. In a preferred embodiment the advertisement characterization vector contains a description of a target market including an indicator of a target product, i.e., purchasers of a particular product type, brand, or product size. The advertisement characterization vector is correlated with a consumer characterization vector which is retrieved based on a unique consumer ID. The correlation factor is determined and indicates if the consumer is a purchaser of the product the advertisement is intended for. This feature can be used to identify purchasers of a particular brand and can be used to target ads at those consumers to lure them away from their present product provider. Similarly, this feature can be used to target ads to loyal consumers to introduce them to a new product in a product family, or different size of product.
One advantage of the present invention is that discretionary target market parameters can be specified and do not necessarily need to correspond to an existing market, but can reflect the various market segments for which the advertisement is targeted. The market segments can be designated by demographic characteristics or by product preferences.
Another advantage of the present invention is that demographic samples of present purchasers of a product are not required to define the target market.
The present invention can be used to determine the applicability of an advertisement to a consumer based on demographics, product preferences, or a combination of both.
In a preferred embodiment of the present invention the correlation is calculated as the scalar product of the ad characterization vector and the consumer characterization vector. The ad characterization vector and consumer characterization vector can be composed of demographic characteristics, product purchase characteristics, or a combination of both.
In a preferred embodiment pricing for the displaying of said advertisement is developed based on the result of the correlation between the ad characterization vector and the consumer characterization vector. In a first embodiment the pricing increases as a function of the correlation. This embodiment can represent the situation in which the party which determines the correlation also controls the ability to display the advertisement.
In an alternate embodiment the price for displaying the advertisement decreases as a function of the degree of correlation. This embodiment can represent the situation in which the consumer controls access to the consumer characterization vector, and charges less to view advertisements which are highly correlated with their interests and demographics. A feature of this embodiment is the ability of the consumer to decrease the number of unwanted advertisements by charging a higher price to view advertisements which are likely to be of less interest.
One advantage of the present invention is that it allows advertisements to be directed to new markets by setting specific parameters in the ad characterization vector, and does not require specific statistical knowledge regarding existing customers of similar products. Another advantage is that the system allows ads to be directed at consumers of a competing brand, or specific targeting at loyal customers. This feature can be useful for the introduction of a new product to an existing customer base.
Another advantage of the present invention is that the correlation can be performed by calculating a simple scalar (dot) product of the ad characterization and consumer characterization vectors. A weighted sum or other statistical analysis is not required to determine the applicability of the advertisement.
The present invention can be realized as a data processing system and as a computer program. The invention can be realized on an individual computer or can be realized using distributed computers with portions of the system operating on various computers.
An advantage of the present invention is the ability to direct advertisements to consumers which will find the advertisements of interest. This eliminates unwanted advertisements. Another advantage is the ability of advertisers to target specific groups of potential customers.
These and other features and objects of the invention will be more fully understood from the following detailed description of the preferred embodiments which should be read in light of the accompanying drawings.